IRS Among Agencies Looking at Issues Created by Lack of Company Ownership Data
Internal Revenue Service and Justice Department officials said Nov. 14 they are aware that a lack of information on the identity of the owners of millions of U.S. companies is an obstacle to law enforcement investigations.
Recommendations for dealing with the issue are expected from IRS within the year, they told members of a Senate homeland security panel.
"The absence of ownership disclosure requirements and lax regulatory regimes in many of our states make U.S. shell companies attractive vehicles for those seeking to launder money, evade taxes, finance terrorism, or conduct other illicit activity anonymously," Norm Coleman (R-Minn.), chairman of the Permanent Subcommittee on Investigations of the Senate Homeland Security and Governmental Affairs Committee, said at the hearing.
K. Steven Burgess, IRS director, examination, Small Business/Self Employed Division, testified that his agency is investigating promoters of Nevada corporations and resident agents under Section 6700 of the Internal Revenue Code.
Several of the investigations have produced client lists that are being used to develop potential non-file audits, Burgess said.
An IRS issue management team is considering further action on the problem and is investigating further, Burgess said. An ultimate outcome could be legislative recommendations, he said.
